Binance Introduces NFT Loan Tool
- Users of Binance NFT can now use select blue-chip NFT collections as collateral to take out cryptocurrency loans.
- The platform will initially support only loans in ETH, and NFT collections Bored Ape Yacht Club, Mutant Ape Yacht Club, Azuki, and Doodles.
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The non-fungible token (NFT) marketplace of crypto exchange Binance is launching a new feature that will allow users to borrow crypto by using their NFTs as collateral, the company said in a blog post on 25 May.
According to the announcement, the new tool called Binance NFT Loan will allow users to use selected blue-chip NFTs as collateral to take out cryptocurrency loans. The company said it will initially support only Ether (ETH) borrowing, and that the service will offer competitive interest rates, instant liquidity, liquidity protection, and zero gas fees. Binance NFT wrote in the blog post:
“As the NFT marketplace continues to evolve, Binance NFT stays ahead of the curve by introducing its innovative NFT Loan feature. This service enables NFT owners to unlock the monetary value of their assets while retaining ownership. The future of NFT finance looks promising, and with responsible use, this new Loan Feature could be a game-changer in how we access and optimize digital asset value.”
The tool will initially only support a select number of NFT collections as collateral, including Bored Ape Yacht Club (BAYC), Mutant Ape Yacht Club (MAYC), Azuki, and Doodles, although Binance is planning to roll out more options in the near future. The amount of ETH that could be borrowed from the platform will depend on the floor price of the NFT, which is determined using data collected from Chainlink and OpenSea.
The new Binance NFT Loan feature comes only a couple of weeks after Binance’s NFT marketplace — which was first introduced in April 2021 — announced it will be launching support for Bitcoin Ordinals, also known as Bitcoin NFTs. Launched in January 2023, Ordinals quickly grew in popularity, and the total inscriptions to date have jumped over 9.1 million according to data from Dune Analytics.
- The crypto exchange blamed the issue on a decision made by its third party payments provider in Australia, noting that it is now looking for a new partner in the country.
- Binance Australia assured users that AUD withdrawals are still available, and that they can continue to buy and sell crypto using debit/credit cards and its P2P marketplace.
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- The Binance NFT marketplace said it will soon expand its multichain ecosystem, and add support for Bitcoin Ordinals, which are also known as Bitcoin NFTs.
- The platform said it will allow users to purchase and trade Ordinals directly from their Binance accounts, bypassing the need to create a separate inscription wallet.
- The exchange first paused Bitcoin withdrawals late on 7 May due to a network congestion issue, but resumed them only an hour and a half later.
- The second pause took place early on 8 May, and lasted almost three hours, but the issue now appears to be fixed after the exchange adjusted its transaction fees.